The Man Who Created the Pencil Eraser and How Patents Have Changed

fermion writes "This weeks 'Who Made That' column in The New York Times concerns the built in pencil eraser. In 1858 Hymen Lipman put a rubber plug into the wood shaft of a pencil. An investor then paid about 2 million in today's dollars for the patent. This investor might have become very rich had the supreme court not ruled that all Lipmen had done was put together two known technologies, so the patent was not valid. The question is where has this need for patents to be innovative gone? After all there is the Amazon one-click patent which, after revision, has been upheld. Microsoft Activesync technology patent seems to simply patent copying information from one place to another. In this modern day do patents promote innovation, or simply protect firms from competition?"

Re:You know where it went..

[hedwards]

You're missing the point. A lot of this was unintentional. They made the USPTO run on fees that were charged for patents which gave the USPTO and incentive to rubber stamp patents while not receiving sufficient funding to cover the cost of having patent examiners that could do the investigation that they used to do.

What needs to happen is that the USPTO needs to go back to being a government service the user fees need to be based upon the amount of time and energy it takes to deal with the application. And while we're at it, the duration of the patent period should go from the point where the first application is received to a reasonable period after that. For technology 7 years is likely more than adequate as a lot of that IP is no longer of value several years later.

And obviously, anybody filing for a patent on software gets to volunteer to test the prototype rectal exam bots.

There are those who create & those who devour

[smittyoneeach]

Some build up, through genius employed.
And lesser men must see work destroyed.

Re:Revised Summary

[Anonymous Coward]

Actually, I think even the idea of enabling people to duplicate inventions is not working anymore

I read an article (can't remember where), saying that companies are actually FORBIDING their employees from checking the patent database, just in case they find out that another patent might perhaps cover something they are working on.

This way, if a lawsuit occurs, they can claim ignorance of existing patents.

But the downside is that people are actively avoiding looking into patent descriptions.

Re:Lawyers

[g01d4]

Really? This link [pencils.com] sounds more reasonable:

During the 1800s, the best graphite in the world came from China. American pencil makers wanted a special way to tell people that their pencils contained Chinese graphite. In China, the color yellow is associated with royalty and respect. American pencil manufacturers began painting their pencils bright yellow to communicate this regal feeling and association with China.

Easy: Incentives

[dcollins]

In 1990, the "everything runs better as a free market" doctrine wiped out government funding of the patent office, declaring that it would be fully funded by applicant fees from then on. (In fact, since that time Congress withholds some percentage of payments, so it's even more under-funded.) So the office doesn't work as a filter to defend a precious monopoly right, instead it's incentivized to make as many applicants happy as possible, since that's where all their money comes from. Result is a tidal wave of poorly examined patents that no one has time or resources to take court. (And yet: also an enormous and growing backlog of yet-unexamined patents). Pretty similar to how they've bent over the U.S. Post Office.

Step 1: Defund core government agency, Step 2: Complain about how government doesn't work, Step 3: Profit (for some private allied company).

http://thomas.loc.gov/cgi-bin/cpquery/?&sid=cp109OaGul&r_n=hr372.109&dbname=cp109&&sel=TOC_11043& [loc.gov]

Re:Revised Summary

[0123456]

I read an article (can't remember where), saying that companies are actually FORBIDING their employees from checking the patent database, just in case they find out that another patent might perhaps cover something they are working on.

Yes. In my previous job, we weren't allowed to read patents for that reason.

Re:Independence of the courts ?

[Phroggy]

OneClick was something new; my recollection is that nobody had done anything quite like it - but not because it was novel or innovative. Nobody had done it before because everybody thought it was a bad idea. Store people's credit card numbers on file, readily accessible later just in case the customer decides to come back and buy something else? Click one button to effect a transaction, with money changing hands and everything? Are consumers really gonna trust you to manage that responsibly?

Amazon's innovation was proving that the answer to that question is yes. That's all. They showed that they could do it without consumers rioting in the streets. If you had asked anyone "skilled in the art" to design a system that could buy stuff online with the click of a button, anyone could have built it. They just probably would have told you it was a bad idea.

Re:Independence of the courts ?

[Nemyst]

The point of the GP is that even a simple patent like Amazon's one-click can be obfuscated, given an army of lawyers, into something unintelligible for most people, judges included. Since there doesn't seem to be a clause for lack of clarity being grounds for patent rejection (which would help a lot in situations like this), the judges just accept them instead of trying to learn or, worse, looking foolish for acknowledging that they don't understand the patent (gasp!).

Re:You know where it went..

[dweller_below]

You're missing the point. A lot of this was unintentional. They made the USPTO run on fees that were charged for patents which gave the USPTO and incentive to rubber stamp patents while not receiving sufficient funding to cover the cost of having patent examiners that could do the investigation that they used to do.

I'd like to think that this mess is unintentional. But many of the recent changes to the USPTO appear to have optimized it to create lots of poor quality patents. I believe that we could reverse these changes. But, we would need to muster the political will to admit we have made mistakes. I have listed some of these obvious structural problems at: https://plus.google.com/b/101806809558932714222/101806809558932714222/about [google.com]

I believe that the most serious problems with the structure of the USPTO are:

• 1) More patents are not better than fewer patents. Patents are not Innovation. Patents are not Progress. Patents are simply grounds to file a lawsuit against an industry. More Patents are simply more grounds for more lawsuits. An occasional lawsuit might spur innovation. BUT LAWSUITS DO NOT PRODUCE. Lawsuits are parasitic on innovation and production. Reform must recognize that patents are dangerous monopolies. Reform must place hard limits on the number of patents.
• 2) Running the US Patent Office as a cost-recovery operation is a mistake. The US Patent Office is a very small, but critical component of the US economy. It's purpose was "..to promote the Progress of Science and useful Arts.." (US Constitution Article One, Section 8(8).) But, once the USPTO started to become completely cost recovery, (See: Omnibus Budget Reconciliation Act of 1990, Title X, Subtitle B), that primary goal became overshadowed by the more pressing goal of securing funding via patent fees. The primary effect of cost recovery has been to promote the collection of patent fees. Reform is painful, but simple. Admit cost recovery is a failed experiment. Revert the funding model to the model used for the first 200 years. The USPTO must be centrally funded by the US government. Any collected fees should be returned to the US Government.
• 3) It is a mistake to organize the US Patent Office to create economic incentives to grant poor patents. Currently most of the revenue of the US Patent Office comes from GRANTING patents. See the USPTO FY 2013 President's Budget page 37: www.uspto.gov/about/stratplan/budget/fy13pbr.pdf "..More than half of all patent fee collections are from issue and maintenance fees, which essentially subsidize examination activities." A recent study by the Richmond School of Law found that the USPTO's actual grant rate is currently running at about 89%. In 2001, it was as high as 99%. See http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2225781 [ssrn.com] page 9. In 2001, it didn't matter if an application was overbroad, obvious, trivial, a duplicate, or unreasonable, they ALL got granted. Things haven't improved much since then. Reform could come in many forms, but the simplest and most reliable would be to eliminate and unify the Patent office fees into a single filing fee. This fee would provide no guarantee of receiving a patent, only a guarantee that your patent would be considered. This would free the Patent Office to be able to deny poor patents. The filing fee should be high enough to discourage spurious patent applications.
• 4) Scaling up the Patent Office to produce more poor quality patents is a mistake. Currently, we expand the number of patent examiners based on demand. See the USPTO FY 2013 President's Budget, page 60, Gap Assessment: "Meeting this commitment assumes efficiency improvements brought about by reengineering many USPTO management and operational processes (e.g., the patent examination process) and systems, and hiring about 3,00

Re:Independence of the courts ?

[chrismcb]

It sounds like you don't understand what OneClick is. Not only was it not common then, it's not common now.

It wasn't common then because people didn't think consumers would want to buy something with one click. Cause you know, spending money without authorization is kind of scary. And of course now it is patented, so its not common.
But I wouldn't be surprised if the concept of "one click" didn't already exist, just not for buying something.

Re:Independence of the courts ?

[Anonymous Coward]

Obvious in this case, means that the implementation of the idea not the marketing ability of the vendor. The fact that you can roll various different variables into an action based on a single click is plainly obvious from a technical perspective. Having a button that makes a call to a few relational databases isn't exactly high science now, nor was it then. If anything patents should be going down as the low hanging fruit is gone, with booms around times of new technology.

You know what makes companies invest in interface design and research? The gobs of money they get when the end user or advertiser gives them money. No one builds UI for the consumer. They focus on click maps and the like because they want to more efficiently drive users to where the company wants them to be to make more money. You know the only thing that stops when these kinds of patents go away? The fear legitimate inventors and companies have. The legal teams wasted on fighting patent trolls.

You know what I'd rather these people were spending their time on? Smart mines that don't kill kids, carbon nanotubes, space elevators, getting off this darned planet. Show me someone with a big darn idea other than Elon Musk and Richard Branson(really I'm sure there are a ton I don't know about). You know why countries and companies begin the downward decline? Because they become too involved with entrenched interests that they divert focus from trying to achieve more.

Abstract ideas aren't patentable.

[TrekkieGod]

I don't get why people think that there wasn't something new here. It's a terrible patenting example because of that.

I'm going to reply to you again, because I think I've figured out the flaw in your reasoning, and why nobody is seeing eye to eye here:

You seem to think you can patent an idea. You can't. It says so right in the uspto website.

So if you want to figure out if the patent is valid, and not obvious, you take the idea over to an expert in manufacturing. Ask him, "I want to attach an eraser to a pencil. Do you know how to go about doing that?" If he can come up with different ways on the spot, it's obvious.

On the other hand, I want rocket boots. I can go to a rocket scientist and ask him, "I want to attach rockets to boots. Do you know how to go about doing that?" He's going to tell me, "yeah, there's a ton of problems with this. We need to figure out where to put the fuel, rockets have a way of exploding, which make them not very safe, they're not particularly stable, and when you combine that with legs that can move all around you've got serious problems, etc." There are serious technical challenges to all of that. Solve any one of those challenges that experts in the field current have, and you can get a patent on it. The idea of putting rockets in boots still isn't. Your particular solution that makes it possible, or brings it closer to reality, that's patentable, if it's new and non-obvious to experts in the field.